Music

Pandora Reveals How Much It Pays Artists

Responding to critics' claims that musicians make little or no money from music-streaming services, Pandora founder Tim Westergren has detailed the amounts certain artists rake in — some nearing $3 million annually.

Westergren, the company's current chief strategy officer, said Tuesday the "revenue stream is meaningful" and further explained Pandora's philosophy on paying musicians.

"For over two thousand artists, Pandora will pay over $10,000 dollars each over the next 12 months (including one of my favorites, the late jazz pianist Oscar Peterson), and for more than 800 we'll pay over $50,000, more than the income of the average American household," he said in a statement. "We're talking here about the very real possibility of creating, for the first time ever, an actual musicians middle class."

Pandora also pays popular artists such as Adele, Coldplay, Jason Aldean and Wiz Khalifa more than $1 million each annually, he claimed, while Drake and Lil Wayne take in almost $3 million.

Last month, Pandora rallied people around the Internet Radio Fairness Act, a bill introduced to the U.S. Congress that would curb the royalties music-streaming services pay compared to terrestrial and satellite radio.

"Since Pandora accounts for just 6.53% of all radio listening in the U.S., it seems fundamentally unfair that other forms of radio that represent much larger shares of U.S. radio listening pay substantially less to artists," Westergren said, addressing the bill. "Congress must stop the discrimination against internet radio and allow it to operate on a level playing field, under the same rules as other forms of digital radio."

Update: Pandora PR has reached out to Mashable and has since edited on its blog the first part of the above quote to read as such: "It's hard to look at these numbers and not see that internet radio presents an incredible opportunity to build a better future for artists. Not only is it bringing tens of millions of listeners back to music, across hundreds of genres, but it is also enabling musicians to earn a living. It's also hard to look at these numbers, knowing Pandora accounts for just 6.5% of radio listening in the U.S., and not come away thinking something is wrong."

Westergren also described implications the bill — which if enacted would increase the value of Pandora — might have on radio and musicians:

Making performance fees fair for internet radio will drive massive investment in the space, accelerating the growth of the overall sector, and just as importantly accelerating the development of new technology that leverages the incredible power of the internet to build and activate new audiences. That's where the great opportunity lies in the long run. The short-term reduction in revenue would be rapidly swamped by the overall growth of the sector. Imagine the impact on artists if this industry grew to become 25% or even 50% of radio listening.

Are you surprised with how much Pandora says it pays artists? And are these monetary revelations from Westergren enough to persuade Congress to pass the Internet Radio Fairness Act?

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